GK410142.RO
STATE OF NEW YORK
DIVISION OF HOUSING AND COMMUNITY RENEWAL
OFFICE OF RENT ADMINISTRATION
GERTZ PLAZA
92-31 UNION HALL STREET
JAMAICA, NEW YORK 11433
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IN THE MATTER OF THE ADMINISTRATIVE : ADMINISTRATIVE REVIEW
APPEAL OF DOCKET NO.GK410142RO
Lekjanin Realty Corporation, : DRO DOCKET NO.ZEC410014RP
c/o Rhodes Building (TA11402)(CDR 30,236)
Management, (BH410358RO)
Tenant: Diana Rogers
PETITIONER :
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ORDER AND OPINION GRANTING PETITION FOR ADMINISTRATIVE REVIEW
IN PART
On November 23, 1992 the above-named petitioner-owner filed a
Petition for Administrative Review against an order issued on
November 4, 1992 by the Rent Administrator, 92-31 Union Street,
Jamaica, New York concerning the housing accommodations known as
Apartment 5B at 127 West 96th Street, New York, New York wherein
the Rent Administrator determined the fair market rent pursuant to
a comparability study and the special fair market rent guideline
promulgated by the New York City Rent Guidelines Board for use in
calculating fair market rent appeals.
The Commissioner notes that this proceeding was filed prior to
April 1 , 1984. Sections 2526.1(a)(4) and 2521.1(d) of the Rent
Stabilization Code (effective May 1, 1987) governing rent
overcharge and fair market rent proceedings provide that
determination of these matters be based upon the law or code
provisions in effect on March 31, 1984. Therefore, unless
otherwise indicated, reference to Sections of the Rent
Stabilization Code (Code) contained herein are to the Code in
effect on April 30, 1987.
The issue in this appeal is whether the Rent Administrator's order
was warranted.
The Commissioner has reviewed all of the evidence in the record and
has carefully considered that portion of the record relevant to the
issue raised by the administrative appeal.
GK410142.RO
This proceeding was originally commenced in May, 1983 by the filing
of an overcharge complaint form by the tenant with the New york
City Conciliation and Appeals Board, the predecessor agency to the
DHCR. The tenant took occupancy pursuant to a lease commencing
September 10, 1977 and expiring September 30, 1979 at a monthly
rent of $350.00. She named the owner as "Peter Lekjanin, c/o
Rhodes Building Mgt."
By letter dated July 13, 1983 the DHCR advised the parties that the
case would be processed as a fair market rent appeal.
In answer, the owner stated that the subject apartment was
decontrolled on April 30, 1975 and was rented on June 1, 1975. The
owner submitted leases for the prior tenant. The owner also
submitted June 30, 1974 rent data for the subject line.
In Order Number CDR 30,236 the Rent Administrator adjusted the
initial legal regulated rent by establishing a fair market rent of
$224.00 effective June 1, 1975, the commencement date of the
initial rent stabilized lease. The owner was directed to refund
excess rent of $6,296.95 to the tenant.
In a Petition for Administrative Review (Docket No. BH410358RO),
the owner contended that the Rent Administrator improperly
processed the tenant's complaint of rent overcharge as a fair
market rent appeal; that the tenant failed to allege that her
initial rent exceed the fair market rent and to present facts to
support such allegation; and that the owner was not afforded an
opportunity to submit post-June 30, 1974 comparability data.
In an order issued on February 26, 1990 the proceeding was remanded
to afford the owner an opportunity to submit post-June 30, 1974
comparability data. The owner failed to submit any such data in
the new proceeding (Docket No.EC410014RP).
In an order issued on November 4, 1992 the Rent Administrator
determined that the tenant had paid excess rent of $7,524.96,
including excess security of $105.68, from September 10, 1977
through August 22, 1984, the date that she bought the apartment.
The order listed the owner as "Peter Lekjanin/ Lekjanin Realty
Corp., c/o Rhodes Building Mgmt. Inc."
GK410142.RO
In this petition (signed by Peter Lekutanaj, who signed the
tenant's 1977 lease and who is listed as the owner and/ or manager
on all but one of the registrations from 1984 through 1992), the
owner contends in substance that the Administrator improperly
processed the tenant's complaint of rent overcharge as a fair
market rent appeal,even though the tenant was not the first tenant
following vacancy decontrol, even though she never indicated that
she was challenging the Fair Market Rent, and even though she did
not as required allege any facts which would support any allegation
that her initial rent was in excess of the Fair Market Rent; that
the Administrator's attempt to circumvent the requirements of the
Rent Stabilization Law and Code has resulted in a windfull to the
tenant since the owner no longer has documentation for other
apartments in the "B" line and thus cannot submit comparability
data; that the Administrator should have allowed the owner to
submit comparables either based on the registered lawful rents, or
pursuant to the current Code, since the Courts have held that the
DHCR should apply the current law in effect; and that the Peter
Lekjanin should not have been listed on the order since he was
never an owner of the subject premises, it having been owned at all
relevant times by Lekjanin Realty Corp.
In answer, the tenant asserts in substance that the owner was
notified on July 13, 1983 that the matter would be processed as a
fair market rent appeal.
The Commissioner is of the opinion that this petition should be
granted in part.
While the tenant filed her complaint on a rent overcharge complaint
form, it is apparent from the tenant's complaint that the tenant
wished to challenge the initial legal regulated rent. The tenant
submitted with her complaint a copy of the 1972 Maximum Base Rent
order for the subject apartment and calculations for the fair
market rent for the prior tenant based on the 1972 Maximum Base
Rent. It is within the discretion of the DHCR to treat complaints
or applications so as to insure that the complaint or allegations
raised by the complaint or applicant are addressed despite the use
of an incorrect form. The Commissioner therefore finds that the
Administrator properly processed the case as a fair market rent
appeal.
While the complainant was the second stabilized tenant, the owner
did not submit proof of service of a DC-2 form on the prior tenant,
which proof would have foreclosed the complainant's right to
challenge the initial legal regulated rent. The owner did submit
a Form R-42 Landlord's Report of Statutory Decontrol, but even that
GK410142.RO
was for Apartment 15B rather than 5B.
The Commissioner finds that the tenant's fair market rent appeal is
not materially defective because of the tenant's failure to allege
that the rent exceeded the fair market rent for the subject
apartment. Such allegation is implicit in the tenant's complaint
as indicated above. The Commissioner further finds that since the
directive to tenants in Section 25(c) of the former Rent
Stabilization Code to provide supporting facts is qualified by the
phrase "to the best of his information and belief," it cannot be
read to create a firm requirement and the tenant's failure to
present such facts does not warrant dismissal of the tenant's fair
market rent appeal. (Accord: ARL 6666-L).
Sections 26-513 of the Rent Stabilization Law and 2522.3(e) of the
current Code provide, in pertinent part, that fair market rent
adjustment applications are to be determined by the use of special
fair market rent guidelines orders promulgated by the New York City
Rent Guidelines Board and by the rents generally prevailing in the
same area for substantially similar housing accommodations.
In order to determine rents generally prevailing in same area for
substantially similar housing accommodations, it is DHCR's
procedure for fair market rent appeal cases filed prior to April
1, 1984 to allow owners to submit June 30, 1974 free market rental
data for complete lines of apartments, beginning with the subject
line. The average of such comparable rentals will be then be
updated by annual guidelines increases. Alternatively, DHCR
procedure allows owners to have comparability determined on the
basis of rents charged after June 30, 1984. In order to use this
method, owners were required prior to November 1, 1984 to submit
rental history data for all stabilized apartments in the subject
premises and subsequent to November 1, 1984 to submit such data for
complete lines of apartments beginning with the subject line.
Post-June 30, 1974 rent data will be utilized if the comparable
apartment was rented to a first stabilized tenant within one year
of the renting of the subject apartment and if the owner submits
proof of service of an initial legal regulated rent notice (DC-2
Notice) or apartment registration form indicating that the rent is
not subject to challenge.
The Commissioner does not consider that the owner has been unduly
prejudiced even if it did discard rental data relevant to a fair
market rent appeal proceeding which it has known about since 1983.
The owner did respond to the opportunity to submit June 30, 1974
comparability data by submitting useable data for two apartments in
the "B" line, although it did not respond to a later opportunity to
submit post- June 30, 1974 comparables. The rents of the
GK410142.RO
comparable apartments were updated to the time of the prior
tenant's first (initial stabilized) lease, and averaged with the
rent obtained by use of the Special Guidelines Order, to arrive at
the Initial legal Regulated Rent. Appropriate Guidelines
increases were than applied to that rent to arrive at the lawful
rents for the complainant.
Regarding the owner's contention that the Administrator should have
allowed it to submit comparables either based on the registered
lawful rents, or pursuant to the current Code, the Commissioner
notes that the fair market rent appeal applied to the rent existing
in 1975; that rents were not registered until 1984 and thus could
not be used to determine a 1975 rent; and that pursuant to Section
2521.1 of the current Code , fair market rent appeals filed prior
to April 1, 1984 are to be determined based upon the Code in effect
on March 31, 1984.
The owner is correct about Peter Lekjanin. Whether or not the
name of Lekjanin Realty was formed by combining portions of the
names of two or more people, there is no evidence in the record
that anyone with the name of Peter Lekjanin (as opposed to Peter
Lekutanaj) even exists. The Administrator's order should therefore
be modified to state the owner as "Lekjanin Realty Corp., c/o
Rhodes Building Mgmt. Inc." In addition, excess security of
$105.68 should be removed from the total of $7,524.96, since the
complainant bought the apartment in 1984.
THEREFORE, in accordance with the Rent Stabilization Law and Code,
it is
ORDERED, that this petition be, and the same hereby is, granted in
part and that the Administrator's order be, and the same hereby is,
modified in accordance with this order and opinion. The total
refund due the tenant is $7,419.28.
ISSUED:
JOSEPH A. D'AGOSTA
Deputy Commissioner
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